Last updateMon, 22 Nov 2021 4pm

Pay-per-part: TRUMPF and Munich Re plan new business model for the manufacturing industry

The TRUMPF Group and the Munich Re Group (Munich Re) intend to enter into a strategic partnership for a novel service offering of laser cutting machines. The jointly developed "pay-per-part model" is intended to enable customers in future to use fully automatic laser machines from TRUMPF without having to buy or lease them. Instead, customers will pay a previously agreed price for each cut sheet metal part. In this way, they can make their production much more flexible and react more dynamically to changes in the market environment.

The partnership will initially be a project with a learning phase yet to be agreed between the parties in terms of length. Munich Re is acting as a business enabler in this model: it finances the machine and thus bears the investment risk. The IoT service provider relayr, a subsidiary of Munich Re, provides the data analyses required for the financing model. TRUMPF supplies customers with the components they need for production, i.e. both the machines for their factory buildings and the associated software and services for manufacturing the sheet metal parts. Klöckner & Co, one of the world's largest producer-independent companies in steel distribution, becomes a development partner for the business model.
Within the framework of the model, the production process is tailored to customer requirements. The performance promise of the offer includes access to a fully automatic laser cutting machine, a storage system, TRUMPF's production know-how and necessary service parts, as well as maintenance of the equipment and provision of the raw materials to be used.
The pay-per-part model thus offers companies in the sheet metal processing industry completely new, disruptive business and production opportunities. Customers get access to the latest automated laser cutting technologies without having to make major investments, and production volumes can be easily adjusted to demand. Thanks to Munich Re's planned performance guarantee, clients will also be insured against the financial impact of potential production losses in the future.
"With this partnership, we will move into new business models more clearly than ever before," says Mathias Kammüller, Group Managing Director and Chief Digital Officer of TRUMPF, "It will be a first step towards offering our customers production capacity without major up-front investment as an alternative to traditional machine purchases. In addition, we are convinced that this offer will not only help existing customers to grow, but also to win new customers".
Torsten Jeworrek, member of Munich Re's Board of Management, explains: "The cooperation with TRUMPF is an outstanding example of how the combination of the Munich Re Group's various offerings - risk solutions, IoT technology and financing - makes it possible to develop innovative business models for industry. We are convinced that such partnerships represent a forward-looking response to the challenges of an increasingly dynamic market environment.
"We are very pleased to be part of this great partnership", adds Josef Brunner, CEO of relayr. "relayr provides IoT infrastructure and enables comprehensive data analysis and optimisation, on which in turn the financing and guarantee model of the project is based. For industrial companies it is no longer enough to manufacture good products. Business models have to be transformed in order to be sustainable. With this step, TRUMPF is demonstrating that it is absolutely future-oriented and is prepared to break new ground in order to offer its customers completely new possibilities".
"Being able to support the pay-per-part offerings of TRUMPF and Munich Re as development partners makes us proud and confirms our conviction that the future belongs to digital business models," says Gisbert Rühl, CEO of Klöckner & Co. "We are therefore convinced that the market is more than ready for pay-per-part offerings and have full confidence in the new model. Working together in this digital business model is an important step into the future, and we are sure that many interesting opportunities will arise from it".
The partnership between Munich Re and TRUMPF is subject to merger control clearance by the relevant authorities.



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